Which of the following best describes a fraudulent cash scheme to overstate cash assets at year end by recording deposits in transit in both the account from which the cash is withdrawn and the account to which it is transferred?

Question

Quizplus · Accepted Answer

This describes kiting of cash, where funds are recorded as both a deposit in transit and as an asset in the receiving account, artificially inflating cash balances. It is a form of fraud and can be used to deceive investors or lenders. Lapping of cash involves stealing cash from one account and covering it up by using subsequent deposits from other accounts. Embezzlement of cash involves the direct theft of cash or checks. Restrictive endorsements of cash involve adding restrictions to how a check can be cashed or deposited.

Which of the Following Best Describes a Fraudulent Cash Scheme